Local government debt risk early-warning system and empirical analysis

Firstly, the methods of “financial particle theory” and “objective decomposition” are used in this paper to select the typical indexes from three sectors of “borrowing, using & repaying” and all sectors corresponding weight are shown, combined with “risk mapping”; Secondly, the range and claim-size distributions of all indexes are shown in international standard, and the risk factors are calculated; Finally, the paper draws the conclusion that the analysis report is consistent with the current situation combined with case analysis. So, local government policy makers can take appropriate measures to prevent and control the occurrence of debt risk based on the conclusion above.